Old Mutual has announced its cash and share offer for Skandia, conditional on the recommendation of the Swedish insurance group's board.
Old Mutual offered 44.9bn kroner (£4.1bn) for the group. The offer is 25% more than Skandia's closing share price in May, when talks were announced. It is expected that Skandia shareholders will support the bid. The combined group would have a market capitalisation of £7.9bn.
Old Mutual is proposing integration of its Selestia platform with Skandia's open architecture business as the group aims to improve margins, though the final plans will not be confirmed for at least six months.
On the UK fund management side there is little cross-over between Skandia Investment Management, which is predominantly a multi-management group, and Old Mutual Asset Managers, which provides single strategy fund management. Although Skandia will be the dominant brand in Europe, Old Mutual Asset Managers will retain its separate brand.
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